Monday, February 25, 2008

Govt Asks ICAI To Prepare Report On IPO Valuation

New Delhi: In the wake of controversy relating to valuation of public issues, the government has directed the apex body of chartered accountants, ICAI, to conduct a study on the initial public offer pricing and suggest ways for protecting the interest of investors. Run-up to Budget 2008-09

"The government has asked the Institute of Chartered Accountants of India (ICAI) to study the issue of IPO valuation and system of stock movements. The ICAI will submit a report on the valuation of IPO in due course," Corporate Affairs Minister Prem Chand Gupta told reporters.

"The ICAI study would take into account the practice followed in other countries as well as India and suggest ways for dealing with it," he said, adding that the apex body would also advise the government on making the whole process of IPO valuation more transparent.

When contacted, the ICAI President Ved Jain said that the institute has constituted a group of technical experts to study the issue of IPO valuation.

The institute, he said, would compare the Indian practices with the best in the world and also study how the other countries have dealt with the problems concerning IPO valuation.

The problem of the IPO valuation came to fore with public issue of some companies plunging below the issue price even on the listing day or afterwards, leaving investors high and dry.

"... the tactical fight for market share (in the industry) is not likely to engage her for long. At some point, that role in government will beckon," the Fortune report had said.

It further added that "Nooyi is an entirely different kind of CEO, a product of her native India as well as of PepsiCo's family-values approach to grooming CEOs."

"... She is not hung up on pay... She is 52 years old and does not plan for this job to be her last. Her friend Henry Kissinger predicts that it is only a matter of time before she is plucked for a big Washington post, possibly a cabinet job, and Nooyi acknowledges that at some point, she'd like that."

The report quoted Kissinger, who consults PepsiCo and other companies on international matters, as saying: "If you look at the job entirely from the American perspective, then it becomes impossible to run a global business."

Fortune said that Nooyi was a "cosmopolitan, rigorously educated, and a strategic thinker" and her background of Boston Consulting Group makes her fit for "burgeoning markets in Russia and China than in the noisy US cola wars."

"A dinner gathering at her house is as likely to include Tony Blair and government ministers from India or Mexico as traditional pinstriped business types," it noted.

The top place on the Forbes list has been grabbed by Catherine Burzik of medical technology company Kinetics Concept, followed by Meg Whitman of internet auction giant eBay and Linda Lang of Jack in the Box, a US fast food chain.

Other names in the list are Susan Ivey of Reynolds American (4th), Anne Stevens of speciality alloy manufacturer Carpenter Technology (5th), Andrea Jung of Avon Products (6th) and Western Union's Christina Gold at the seventh position.

Nooyi was named among the top ten most powerful women in the world in a list prepared by Forbes late last year, which included people from areas of business, politics and entertainment among others.

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